SUMMARY of the 2003 Supreme Court decision re: the ILL-GOTTEN SWISS DEPOSITS of the Marcoses: "x x x. The SWISS DEPOSITS which were transferred to and are now deposited in escrow at the Philippine National Bank in the estimated aggregate amount of US$658,175,373.60 as of January 31, 2002, plus interest, are hereby FORFEITED IN FAVOR OF PETITIONER REPUBLIC OF THE PHILIPPINES ."

SUMMARY of the 2003 Supreme Court decision re: the ILL-GOTTEN SWISS DEPOSITS of the Marcoses:

"x x x. The SWISS DEPOSITS which were transferred to and are now deposited in escrow at the Philippine National Bank in the estimated aggregate amount of US$658,175,373.60 as of January 31, 2002, plus interest, are hereby FORFEITED IN FAVOR OF PETITIONER REPUBLIC OF THE PHILIPPINES ."

SUPREME COURT DECISION (2003)

The decision, dated July 15, 2003, of the Supreme Court, written by former Chief Justice Renato Corona, in the case entitled REPUBLIC OF THE PHILIPPINES vs. SANDIGANBAYAN, FERDINAND E. MARCOS (REPRESENTED BY HIS ESTATE/HEIRS: IMELDA R. MARCOS, MARIA IMELDA [IMEE] MARCOS-MANOTOC, FERDINAND R. MARCOS, JR. AND IRENE MARCOS-ARANETA) AND IMELDA ROMUALDEZ MARCOS, docketed as G. R. No. 52154, referred to the FORFEITURE of the Marcos ill-gotten wealth amounting to US$658,175,373.60 held in escrow in the Philippine National Bank (PNB).

The underlying case was Civil Cas No. 0141, filed by the Republic before the Sandiganbayan against Marcos, et. al.

BACKGROUND OF THE CASE

On December 17, 1991, petitioner Republic, through the Presidential Commission on Good Government (PCGG), represented by the Office of the Solicitor General (OSG), filed a petition for FORFEITURE before the Sandiganbayan, docketed as Civil Case No. 0141 entitled REPUBLIC OF THE PHILIPPINES vs. FERDINAND E. MARCOS, REPRESENTED BY HIS ESTATE/HEIRS AND IMELDA R. MARCOS, pursuant to RA 13791 in relation to EXECUTIVE ORDER NOS. 1,2 2,3 144 and 14-A.

The Republic sought the DECLARATION of the aggregate amount of US$356 million (estimated to be MORE THAN US$658 MILLION inclusive of interest as of July 15, 2003) deposited in escrow in the PNB, as ILL-GOTTEN WEALTH.

The funds were previously held by the following five account groups, USING VARIOUS FOREIGN FOUNDATIONS IN CERTAIN SWISS BANKS: (1) Azio-Verso-Vibur Foundation accounts; (2) Xandy-Wintrop: Charis-Scolari-Valamo-Spinus- Avertina Foundation accounts; (3) Trinidad-Rayby-Palmy Foundation accounts; (4) Rosalys-Aguamina Foundation accounts, and (5) Maler Foundation ACCOUNTS.

In addition, the Republic sought the FORFEITURE of US$25 MILLION and US$5 MILLION in TREASURY NOTES which exceeded the Marcos couple's salaries, other lawful income as well as income from legitimately acquired property.

The treasury notes were FROZEN at the CENTRAL BANK OF THE PHILIPPINES, now Bangko Sentral ng Pilipinas, by virtue of the FREEZE ORDER issued by the PCGG.

Before the case was set for pre-trial, a GENERAL AGREEMENT and the SUPPLEMENTAL AGREEMENTS dated December 28, 1993 were executed by the Marcos children and then PCGG Chairman Magtanggol Gunigundo for a GLOBAL SETTLEMENT of the assets of the Marcos family.

Subsequently, respondent Marcos children filed a motion dated December 7, 1995 for the APPROVAL of said agreements and for the enforcement thereof.

The General Agreement/Supplemental Agreements sought to identify, collate, cause the INVENTORY of and DISTRIBUTE all assets presumed to be owned by the Marcos family under the conditions contained therein.

The aforementioned General Agreement specified in one of its premises or "whereas clauses" the fact that petitioner "obtained a judgment from the Swiss Federal Tribunal on December 21, 1990, that the Three Hundred Fifty-six Million U.S. dollars (US$356 million) belongs in principle to the Republic of the Philippines provided certain conditionalities are met x x x."

The said decision of the SWISS FEDERAL SUPREME COURT affirmed the decision of Zurich District Attorney Peter Consandey, granting petitioner's request for legal assistance. Consandey declared the various deposits in the name of the enumerated FOUNDATIONS to be of ILLEGAL PROVENANCE and ordered that they be FROZEN to await the final verdict in favor of the parties entitled to RESTITUTION.

Hearings were conducted by the Sandiganbayan on the motion to approve the General/Supplemental Agreements. Respondent FERDINAND, JR. was presented as WITNESS for the purpose of establishing the PARTIAL IMPLEMENTATION of said agreements.

On October 18, 1996, the Republic filed a MOTION FOR SUMMARY JUDGMENT and/or JUDGMENT ON THE PLEADINGS. Respondent Mrs. Marcos filed her OPPOSITION thereto which was later ADOPTED by respondents Mrs. Manotoc, Mrs. Araneta and Ferdinand, Jr.

In its resolution dated November 20, 1997, the Sandiganbayan DENIED the Republic's motion for summary judgment and/or judgment on the pleadings on the ground that the motion to approve the compromise agreement " TOOK PRECEDENCE over the motion for summary judgment.

IMELDA Marcos filed a manifestation on May 26, 1998 claiming she was NOT A PARTY to the motion for approval of the Compromise Agreement and that she OWNED 90% of the funds with the remaining 10% belonging to the MARCOS ESTATE.

Meanwhile, on August 10, 1995, the Republic filed with the District Attorney in Zurich, Switzerland, an additional request for the immediate TRANSFER of the deposits to an ESCROW ACCOUNT in the PNB. The request was granted.

On appeal by the Marcoses, the SWISS FEDERAL SUPREME COURT, in a decision dated December 10, 1997, UPHELD the ruling of the District Attorney of Zurich granting the request for the TRANSFER of the funds.

In 1998, the funds were REMITTED to the Philippines in ESCROW .

The case was set for trial. After several resettings, the Republic, on March 10, 2000, filed ANOTHER MOTION FOR SUMMARY JUDGMENT pertaining to the FORFEITURE of the US$356 MILLION, based on the following grounds: (1) THE ESSENTIAL FACTS WHICH WARRANT THE FORFEITURE OF THE FUNDS SUBJECT OF THE PETITION UNDER R.A. NO. 1379 ARE ADMITTED BY RESPONDENTS IN THEIR PLEADINGS AND OTHER SUBMISSIONS MADE IN THE COURSE OF THE PROCEEDING. (2) RESPONDENTS' ADMISSION MADE DURING THE PRE-TRIAL THAT THEY DO NOT HAVE ANY INTEREST OR OWNERSHIP OVER THE FUNDS SUBJECT OF THE ACTION FOR FORFEITURE TENDERS NO GENUINE ISSUE OR CONTROVERSY AS TO ANY MATERIAL FACT IN THE PRESENT ACTION, THUS WARRANTING THE RENDITION OF SUMMARY JUDGMENT.

IMELDA MARCOS filed her OPPOSITION to the petitioner's motion for summary judgment, which opposition was later ADOPTED by her co-respondents Mrs. Manotoc, Mrs. Araneta and Ferdinand, Jr.

In a decision dated September 19, 2000, the SANDIGANBAYAN GRANTED the Republic's MOTION FOR SUMMARY JUDGMENT.

Imelda Marcos filed a MOTION FOR RECONSIDERATION dated September 26, 2000. Likewise, Mrs. Manotoc and Ferdinand, Jr. filed their own motion for reconsideration dated October 5, 2000. Mrs. Araneta filed a manifestation dated October 4, 2000 adopting the motion for reconsideration of Mrs. Marcos, Mrs. Manotoc and Ferdinand, Jr.

In a resolution dated January 31, 2002, the Sandiganbayan REVERSED its September 19, 2000 decision, thus DENYING the Republic's MOTION FOR SUMMARY JUDGMENT on the grounds that the evidence offered for summary judgment of the case did not prove that the money in the Swiss Banks belonged to the Marcos spouses because no legal proof exists in the record as to the ownership by the Marcoses of the funds in escrow from the Swiss Banks.

HENCE, the Republic filed before the Supreme Court the INSTANT PETITION FOR CERTIORARI, arguing that the Sandiganbayan, in reversing its September 19, 2000 decision, committed GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION.

RULING OF THE SUPREME COURT

One of the foremost concerns of the Aquino Government in February 1986 was the RECOVERY of the UNEXPLAINED OR ILL-GOTTEN WEALTH reputedly amassed by former President and Mrs. Ferdinand E. Marcos, their relatives, friends and business associates.

Thus, the VERY FIRST EXECUTIVE ORDER (EO) issued by then PRESIDENT CORAZON AQUINO upon her assumption to office after the OUSTER OF THE MARCOSES was EO No. 1, issued on February 28, 1986. IT CREATED THE PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT (PCGG) and charged it with the task of assisting the President in the "RECOVERY OF ALL ILL-GOTTEN WEALTH accumulated by former President Ferdinand E. Marcos, his immediate family, relatives, subordinates and close associates, whether located in the Philippines or abroad, including the TAKEOVER OR SEQUESTRATION of all business enterprises and entities owned or controlled by them during his administration, directly or through nominees, by taking undue advantage of their public office and/or using their powers, authority, influence, connections or relationship."

The crucial ISSUES which the Supreme Court resolved were: (1) whether or not respondents raised any GENUINE ISSUE OF FACT which would either justify or negate summary judgment; and (2) whether or not petitioner Republic was able to prove its case for FORFEITURE in accordance with Sections 2 and 3 of RA 1379.

(1) THE PROPRIETY OF SUMMARY JUDGMENT

The Supreme Court held that respondent Marcoses had failed to raise any GENUINE ISSUE OF FACT IN THEIR PLEADINGS. Thus, on motion of petitioner Republic, SUMMARY JUDGMENT should take place as a MATTER OF RIGHT.

SUMMARY JUDGMENT is a judgment which a court may render before trial but after both parties have pleaded. It is ordered by the court upon application by one party, supported by affidavits, depositions or other documents, with notice upon the adverse party who may in turn file an opposition supported also by affidavits, depositions or other documents. This is after the court summarily hears both parties with their respective proofs and finds that there is NO GENUINE ISSUE between them. Summary judgment is sanctioned in this jurisdiction by Section 1, Rule 35 of the 1997 Rules of Civil PROCEDURE, which provides that "a party seeking to recover upon a claim, counterclaim, or cross-claim or to obtain a declaratory relief may, at any time after the pleading in answer thereto has been served, move with supporting affidavits, depositions or admissions for a summary judgment in his favor upon all or any part thereof"; and that "summary judgment is proper when there is clearly NO GENUINE ISSUE as to ANY MATERIAL FACT in the action."

The theory of summary judgment is that, although an answer may on its face appear to tender issues requiring trial, if it is demonstrated by affidavits, depositions or admissions that THOSE ISSUES ARE NOT GENUINE BUT SHAM OR FICTITIOUS, the Court is justified in DISPENSING WITH THE TRIAL AND RENDERING SUMMARY JUDGMENT for petitioner Republic.

According to the Supreme Court, the Solicitor General made a very THOROUGH PRESENTATION of its case for FORFEITURE.

Upon careful perusal of the Answers of the respondents Marcos widow and heirs, the Supreme Court held that they had INDUBITABLY FAILED TO TENDER GENUINE ISSUES in their answer to the petition for forfeiture.

A GENUINE ISSUE is an ISSUE OF FACT which calls for the PRESENTATION OF EVIDENCE as distinguished from an issue which is FICTITIOUS AND CONTRIVED, set up in BAD FAITH OR PATENTLY LACKING IN SUBSTANCE so as not to constitute a genuine issue for trial.

Respondents' defenses of "lack of knowledge for lack of privity" or "(inability to) recall because it happened a long time ago" or, on the part of Mrs. Marcos, that "the funds were lawfully acquired" are fully insufficient to tender genuine issues. Respondent Marcoses' DEFENSES WERE A SHAM and evidently CALIBRATED TO COMPOUND AND CONFUSE THE ISSUES.

The pleadings filed by Respondents Marcoses were REPLETE with INDICATIONS OF A SPURIOUS DEFENSE, the Supreme Court held.

The Supreme Court asked: How could respondents therefore claim lack of sufficient knowledge or information regarding the existence of the Swiss bank deposits and the creation of five groups of accounts when MRS. MARCOS AND HER LATE HUSBAND PERSONALLY MASTERMINDED AND PARTICIPATED IN THE FORMATION AND CONTROL OF SAID FOUNDATIONS? This is a fact respondent Marcoses were never able to explain.

Not only that. Respondents' answers also TECHNICALLY ADMITTED THE GENUINENESS AND DUE EXECUTION OF THE INCOME TAX TAX RETURNS (ITRs) and the BALANCE SHEETS of the late Ferdinand E. Marcos and Imelda R. Marcos ATTACHED TO THE PETITION FOR FORFEITURE, as well as the VERACITY OF THE CONTENTS THEREOF.

(2) THE PROPRIETY OF FORFEITURE

The law raises the PRIMA FACIE PRESUMPTION that a PROPERTY IS UNLAWFULLY ACQUIRED, hence SUBJECT TO FORFEITURE, if its amount or value is MANIFESTLY DISPROPORTIONATE TO THE OFFICIAL SALARY and other lawful income of the public officer who owns it.

Hence, Sections 2 and 6 of RA 1379 provide:

"Section 2. Filing of petition. – Whenever any public officer or employee has acquired during his incumbency an amount or property which is MANIFESTLY OUT OF PROPORTION TO HIS SALARY as such public officer or employee and to his other lawful income and the income from legitimately acquired property, said property shall be PRESUMED PRIMA FACIE to have been UNLAWFULLY ACQUIRED ."

"Sec. 6. Judgment – If the respondent is unable to show to the satisfaction of the court that he has lawfully acquired the property in question, then the court shall declare such property in question, FORFEITED IN FAVOR OF THE STATE , and by virtue of such judgment the property aforesaid shall become the property of the State. Provided, That no judgment shall be rendered within six months before any general election or within three months before any special election. The Court may, in addition, refer this case to the corresponding Executive Department for ADMINISTRATIVE OR CRIMINAL ACTION, OR BOTH. "

The Supreme Court established that from 1966 to 1985, Ferdinand E. Marcos and Imelda R. Marcos had accumulated salaries in the amount of P1,570,000 and P718,750, respectively, or a total of P2,288,750.

In addition to their accumulated salaries from 1966 to 1985 are the Marcos couple's combined salaries from January to February 1986 in the amount of P30,833.33.

Hence, THEIR TOTAL ACCUMULATED SALARIES amounted to P2,319,583.33. Converted to U.S. dollars on the basis of the corresponding peso-dollar exchange rates prevailing during the applicable period when said salaries were received, the total amount had an EQUIVALENT VALUE OF $304,372.43.

The sum of $304,372.43 should be held as THE ONLY KNOWN LAWFUL INCOME of respondents since they DID NOT FILE ANY STATEMENT OF ASSETS AND LIABILITIES (SAL), AS REQUIRED BY LAW, from which their NET WORTH could be determined.

Besides, under the 1935 Constitution, Ferdinand E. Marcos as President COULD NOT RECEIVE "ANY OTHER EMOLUMENT from the Government or any of its subdivisions and instrumentalities".

Likewise, under the 1973 Constitution, Ferdinand E. Marcos as President COULD "NOT RECEIVE DURING HIS TENURE ANY OTHER EMOLUMENT from the Government or any other source."

In fact, his management of BUSINESSES, like the administration of FOUNDATIONS to accumulate funds, was EXPRESSLY PROHIBITED under the 1973 CONSTITUTION.

Section 9 of the PCGG RULES AND REGULATIONS provides that, in determining PRIMA FACIE EVIDENCE OF ILL-GOTTEN WEALTH, the VALUE of the accumulated assets, properties and other material possessions of those covered by Executive Order Nos. 1 and 2 must be OUT OF PROPORTION to the KNOWN LAWFUL INCOME of such persons.

The respondent MARCOS COUPLE DID NOT FILE ANY STATEMENT OF ASSETS AND LIABILITIES (SAL) from which their NET WORTH could be determined. Their FAILURE to file their SAL was in itself a VIOLATION OF LAW and to allow them to successfully assail the Republic for not presenting their SAL would reward them for their violation of the law.

DISPOSITIVE PORTION OF THE SUPREME COURT DECISION

"WHEREFORE, the petition is hereby GRANTED. The assailed Resolution of the Sandiganbayan dated January 31, 2002 is SET ASIDE. The SWISS DEPOSITS which were transferred to and are now deposited in escrow at the Philippine National Bank in the estimated aggregate amount of US$658,175,373.60 as of January 31, 2002, plus interest, are hereby FORFEITED IN FAVOR OF PETITIONER REPUBLIC OF THE PHILIPPINES ."

Source:

G.R. No. 152154 July 15, 2003

REPUBLIC OF THE PHILIPPINES, petitioner,
vs.
HONORABLE SANDIGANBAYAN (SPECIAL FIRST DIVISION), FERDINAND E. MARCOS (REPRESENTED BY HIS ESTATE/HEIRS: IMELDA R. MARCOS, MARIA IMELDA [IMEE] MARCOS-MANOTOC, FERDINAND R. MARCOS, JR. AND IRENE MARCOS-ARANETA) AND IMELDA ROMUALDEZ MARCOS, respondents.

Link:

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